Using a sample of U.S. mergers and acquisitions, this study evaluates how banking relationships influence acquirers' choice of financial advisors. Specifically, it examines: i) acquirers' previous relationships with advisors in various financial activities: M&A advisories, equity issuings and...

We examine the way investment banks allocate IPOs to their affiliated mutual funds worldwide. An underwriter may allocate hot IPOs to its affiliated funds to improve fund performance and increase asset management fees. Alternatively, a bank may allocate to its affiliated mutual funds...

This study examines the consequences of the series of reforms targeting investment-banking-related conflicts of interest. We compare and contrast optimism biases in analysts' stock recommendations and earnings forecasts across different types of analyst firms in the post-reform period...

The Term Securities Lending Facility (TSLF) lent $2.3 trillion worth of general collateral to eighteen investment houses in exchange for riskier securities. Treasury collateral was in high demand in 2008 and 2009 as repo markets shunned lower quality collateral. This paper finds a negative and...

In the aftermath of the global financial crisis, the market share of US investment banks is rising, while that of their European counterparts is declining. We present evidence that US investment banks are on the verge of taking over pole position in European investment banking. While the US...

This paper investigates whether conflicts of interest exist between the research and proprietary trading departments of full-service investment banks. Using a data set of 11,590 analyst stock recommendations over the period 1999-2007, we find that in the period preceding the Global Research...

Reforms on analyst conflicts of interest prohibit the use of investment banking revenue to fund equity research and compensate equity analysts. After the reforms, we find that star analysts from investment banks are more likely to exit the profession and move to the buy side than before. The...

Companies collected billions in premiums from peculiarly structured put options written on their own stock, while almost all of these puts expired worthless quarter after quarter. Buyers of these options, primarily investment banks, lost money as a result. Although these losses might seem...

In this paper, we empirically examine how government forces vis-à-vis market forces have affected the market share of investment banks in Chinese domestic IPOs over the period 1995–2010. Before 2005, only political connections significantly positively influenced the market share of investment...